Prime Minister reshaping the way Canada is governed

Stephen Harper says the most fun he had in 2011 was winning his majority government. And now Canadians are seeing just how much fun he is having as he pushes through his long-promised agenda of political and justice reforms.

Canadians are seeing something else, too – how the Prime Minister is beginning to reshape the way Canada is governed.

Those who have worked with Mr. Harper and are close to him are not surprised by his approach to federalism.

Tom Flanagan, the Prime Minister’s former mentor who is now a political science professor at the University of Calgary, sees Mr. Harper moving away from “executive federalism” – constant negotiations with the provinces – to a “more classical view” of federalism, in which constitutional jurisdictions are respected.

The first hint of that came this week with the take-it-or-leave-it health-care accord with the provinces.

Standing in the living room of 24 Sussex, where he was playing host to reporters at a Christmas reception Monday night just hours after the health deal became public, Mr. Harper was in an engaging mood.

He talked about the accord and the style in which it was presented to the provinces, suggesting that he was not one for first ministers’ meetings and long, protracted negotiations.

In addition, he was adamant that the provinces not be the ones deciding how much the federal government should spend.

His deal is generous, by most accounts. The new funding formula guarantees a 6-per-cent annual increase until 2017, then it is tied to the increase in the gross domestic product until 2024.

But what the deal doesn’t do is try to impose standards or make provinces accountable for the funding.

Mr. Harper also spoke about former Liberal prime minister Paul Martin’s marathon session with the premiers that resulted in the 2004 health accord. Mr. Martin had no agenda going in to the meeting, said Mr. Harper, who was dismissive of its results.

“He’s just not one for those kind of large meetings,” says Doug Finley, who served as the Conservative campaign manager in the 2006 and 2008 elections in which the Tories won their first two governments. Mr. Harper then appointed him to the Senate.

“Stephen likes to take things on in a very direct way,” he says. “He’s very focused.”

So direct that Mr. Harper is putting the onus on the provinces to find a fix for health care. In fact, he told reporters Monday night that he doesn’t know what the answer is.

But that’s not his problem. The provinces have expertise and operational responsibility for health and the federal government is nothing but a financial partner, others have pointed out.

By dealing swiftly with his election promises and now the health-care issue – there were expectations that it would dominate the parliamentary agenda in 2012 – political observers are now looking for what may be the Prime Minister’s “big idea.”

Instead, 2012 will be all about dealing with the world economic situation, Mr. Finley says. A large part of next year, he says, will be defined by the budget and the strategic review that is trying to find $4-billion in annual cuts from government spending.

“The thing that’s obviously overarching is still the economic situation around the world,” Mr. Finley says. “I think everything of a financial nature … will be formulated with that very much in mind. He [the Prime Minister] and the caucus are both extraordinarily targeted to a sound fiscal system in Canada.”

The government’s proposed national security regulator had been part of that plan, Mr. Finley notes. But it was rejected this week by the Supreme Court.

The health-care deal fits into the economic strategy by providing financial stability for the provinces and time to plan. And by taking it off the federal table as an issue, it allows Mr. Harper and his Finance Minister, Jim Flaherty, time to focus on the upcoming budget, which will involve what some are describing as “hellish decisions.”

Prof. Flanagan, meanwhile, notes the Prime Minister “can be bold at times” but “is basically an incremental thinker.” He wonders how far Mr. Harper will take this idea of revamping the way the nation is governed.

“Let’s see what happens with equalization,” says Mr. Flanagan, referring to the federal government’s program of making payments to the so-called “have-not” provinces. “This is pretty wonkish stuff, but it could have a major impact over time on the design of the Canadian welfare state.”